News Analysis – September 2016

General News Summary

Aid Package Signed

The U.S.-Israeli memorandum of understanding signed on September 14 in the State Department Treaty Room, guarantees Israel $38B in military aid in 2018-2027, up from the $31B 10-year package signed with the George W. Bush administration in 2007. But Israeli sources believe that Israel could and should have struck a better deal, were it not for Prime Minister Benjamin Netanyahu’s delaying tactics during the negotiations which had been going on for almost a year.

The talks opened with Israel requesting a much larger package, totaling $45B, partly to compensate for dangers posed to Israel in the wake of last year’s nuclear deal with Iran. That sum was considered realistic had Israel moved quickly to close the deal. But, according to various sources on both sides of the Atlantic, Netanyahu wasn’t interested in a quick agreement, apparently in the hope that by holding off, he might get a better deal from a new administration.

In the end, he got a less favorable deal from the administration of President Barack Obama, with whom the Israeli leader’s relationship is strained. The result is an agreement that guarantees Israel U.S. military support for a decade, with unprecedented conditions that are considerably less favorable to Israel, though still very generous.

First, by including $5B for missile development and placing severe limits on additional allocations from Congress in the package, the agreement effectively sets an annual cap of $3.8B on U.S. aid. (In recent years, Congress has provided supplementary funding for development of Israel’s Arrow, Iron Dome and David’s Sling missile defense systems.) The restriction does allow special allocations in the case of “major conflicts.”

Another provision, allowing Israel to spend 26% of the annual military aid with its own domestic defense contractors, is being phased out in the new deal. The inevitable result will impact Israeli defense contractors, who stand to lose billions of dollars-worth of IDF orders, and have a chain-effect on the economy as a whole.

Sources close to the Israeli prime minister contend that despite the criticism of Netanyahu’s conduct over the nuclear pact with Iran, the deal has seen an increase of American aid to Israel. According to one senior official, it expected that the sides would compromise on less than the $45B Israel sought at the start. “Against the backdrop of significant cuts in the U.S. budget, we got an increase of defense aid to Israel,” the official told Haaretz newspaper.

Scathing criticism came from a number of prominent sources, including Ehud Barak, a former prime minister who served as Netanyahu’s defense minister. Uzi Arad, Netanyahu’s former national security adviser, pointed out that in light of increased prices of military hardware, the $3.8B a year actually would buy less than the annual $3.1B pledged in 2007. In addition, Arad contended that Israel could have won financial and diplomatic benefits had it pushed ahead with the aid package before the Iran nuclear deal was signed. Interviewed by Yediot Aharonot newspaper, Arad said that Netanyahu’s difficult relationship with President Obama had affected the outcome of the talks. If the talks had taken place “in an atmosphere of goodwill and celebration, (the Americans) would have given Israel a varied package of benefits that could have included the promise of American veto at the UN Security Council, scientific and technological cooperation as there never was before, and support in the construction of walls along Israel’s borders—including the Syrian border.”

Netanyahu’s Woes

Embattled on one side by talk of a possible criminal investigation of him and his family for accepting illegal payments and on the other by widening fissures in his ruling coalition and an erosion in his personal popularity, Prime Minister Benjamin Netanyahu faces the upcoming Jewish New Year with a large measure of uncertainty. In mid-September, the Israeli leader’s general weakness was reflected in a poll showing that Yair Lapid, leader of the opposition Yesh Atid (There’s a Future) in first place, ahead of Netanyahu’s Likud.

It was the first time since the last elections, which took place early last year, that Likud had lost first place in the polls, though the margin was small – 24 for Yesh Atid, 22 for Likud. More significant perhaps was the dramatic rise of Yesh Atid, which doubled its strength after winning only 12 seats in the 2015 election.

It’s far too early to begin crowning Lapid as Netanyahu’s successor-apparent, or to talk about a seismic shift on Israel’s political future. For one thing, the next elections are due to take place in more than two years. For another the polls have yet to detect any significant shift between the main blocs. Even if he finished second, Netanyahu is a better bet to build what he sees as his “natural coalition” of right-wing and religious parties. The ultra-Orthodox parties will never join a government headed by the militantly secular Lapid, and neither will Netanyahu’s Likud, which means that Lapid could only build a coalition with left and left-center Meretz and Labor to join with far-right religious Habayit Hayehudi and Yisrael Beiteinu, a very long shot at best.

At least at this early stage, no really significant challenger has emerged. Despite his apparent rise in popularity, Lapid, a former journalist and TV host, lacks the political and security experience of all 11 of Israel’s previous prime ministers. Nor have other possible contenders – a mixed group ranging from former defense minister Moshe Ya’alon and ex-chief of IDF staff Gabi Ashkenazi, to former Likud interior and education minister Gideon Sa’ar, current Defense Minister Avigdor Lieberman, Education Minister Naftali Bennet, and the Labor party’s Isaac Herzog or Shelly Yacimovich or Amir Peretz – achieved anywhere near the status necessary to make a serious challenge.

Peres has a Stroke

Former president Shimon Peres is in serious but stable condition at the Sheba Medical Center outside Tel Aviv in mid-September, after suffering a massive cerebral hemorrhage on September 13. Doctors say the 93-year-old statesman’s condition is stable, adding that he is sedated intermittently to allow his system the best chance of survival.

Will They Meet?

The Russian Foreign Ministry, asserting Moscow’s strengthened presence in the Middle East, said in mid-September that Palestinian President Mahmud Abbas and Israel Prime Minister Benjamin Netanyahu had agreed to meet under its auspices, but there was no indication when or where – such an encounter might take place. Both leaders had accepted “in principle” an invitation to meet in Moscow, but had not reached agreement on a date or an agenda for such talks. Netanyahu and Abbas last met in 2010.

New Security Fence

The Defense Ministry is currently building a new security fence at the southern end of Israel’s border with Jordan. According to Globes business daily, the new fence, which will cost around NIS 300M, will extend about 30 km north from Eilat, Israel’s resort city on the Red Sea. Israel already has security fences in other border areas, including the northern border with Lebanon, the Jordan Valley border with Jordan, and the border with Egyptian Sinai. Israel is building a new airport, named for late Israeli astronaut Ilan Ramon, north of Eilat.

Home Warning System

The IDF’s Home Front Command says it has developed an improved missile warning system for private homeowners. Globes says that the system includes a private home siren that will provide warnings of incoming missiles or artillery shells in real time, telling residents of an area where a missile may land to take cover. Until now, warnings have come from large sirens in municipalities and populated areas, and in “Code Red” warnings broadcast over radio, TV and cellphone networks. The system may be available to the general public within a matter of months.

Syrian Tensions

Israel Air Force jets hit Syrian government positions in mid-September, responding to mortar shells landing intermittently in Israeli territory. There were no indications of an imminent escalation, with Israel viewing the mortar hits as strays not aimed in its direction. On the other hand, President Bashir al-Assad’s regime seems to have upgraded its response to Israeli retaliatory raids, firing surface-to-air missiles at Israeli aircraft. Some Israeli sources interpreted the firing as a sign of Assad’s growing confidence against the background of the new Syrian cease-fire deal and its recent successes on the battlefield.

Powell: Israel Owns 200 Warheads

Israel has not responded to a comment by former U.S. Secretary of State Colin Powell that is has 200 nuclear warheads. A Powell’s spokesman later told AP that Powell was referring to published estimates of the Israeli nuclear stockpile. The comment came to light in a Powell email published by the DCLeaks website in mid-September. In it, the ex-general writing to prominent U.S. donor Jeffrey Leeds, referred to the possibility of Iran building a nuclear warhead. “Iranians can’t use one if they finally make one,” Powell wrote. “The boys in Teheran know Israel has 200, all targeted on Teheran, and we (the U.S.) have thousands.”

African Links

“Israel is coming back to Africa, and Africa is coming back to Israel,” Prime Minister Benjamin Netanyahu said in early July, during a four-country tour of East Africa designed to strengthen Israel’s commercial, diplomatic and security relations with sub-Saharan African countries. Netanyahu, who visited Uganda, Kenya, Rwanda and Ethiopia, attended a ceremony marking the 40th annuversary of the 1976 Operation Entebbe, in which Israeli commandos rescued passangers from a French airliner that had been hijacked to the Ugandan airfield. Netanyahu’s brother Yoni, commander of the operation, was killed at Entebbe. Netanyahu participated in a regional counter-terrorism summit with the presidents of seven African nations – the four countries visited, plus Tanzania, South Sudan and Zambia. The prime minister expressed the hope that closer ties with African countries would change their voting patterns in international forums, reversing what he called @the automatic majority against Israel”.

Saudi Visit

A delegation headed by an influential former Saudi general visited Israel in late July, meeting with Foreign Ministry director-general Dore Gold and high-ranking military officials. The delegation’s visit was informal, but sources in Israel said that the group headed by retired general Anwar Eshki could not have made such a trip without the sanction of King Salman’s regime in Riyadh. Contact with Israel is still a violation of Saudi law, Israeli sources point out.

Eshki, however, claimed that there had been no such permission, that he and a group of Saudi businessmen and academics had been invited by the Palestinian Authority, and that it was not a sign of normalized relations with Israel.

Ministerial Reshuffle

Finance Minister Moshe Kahlon, leader of the Kulanu party has been assigned the Economics portfolio in an early-August reshuffle of cabinet posts. At the same time Ze’ev Elkin took over at the Environment ministry, in addition to his previous position as minister for Jerusalem Affairs. Environment was vacated earlier this year when Kulanu’s Avi Gabbay resigned in protest to the removal of former defense minister Moshe Ya’alon and his replacement by Avigdor Lieberman.

Ben-Eliezer Dies

Former defense minister and deputy prime minister Binyamin (Fuad) Ben-Eliezer died in Tel Aviv on August 28 at the age of 80. A highly decorated IDF brigadier general, Ben-Eliezer, who was born in Basra, Iraq and immigrated with his parents as a child, also served as head of the Labor party and as minister of Housing, National Infrastructure, Communications and Industry and Trade.

Rail Line Opens in October

The new Israel Railways line between Haifa and Beit She’an, in the Jordan Valley, has been completed and is due to open in October. The line, built as a cost of NIS 4B, includes three tunnels and 26 bridges; it follows part of the line between Haifa and Damascus, built by the Ottoman Empire in the late 19th century and closed by the British in 1946.

Munich Victims Honored in Rio

International Olympic Committee President Thomas Bach led a memorial service honoring the 11 Israeli athletes murdered by Palestinian terrorists at the 1972 Munich Games, in a ceremony just prior to the opening of the 2016 Rio Olympics. The IOC was sharply criticized for failing to declare a moment of silence for the 11 in 2012, at the opening ceremony for the London Games.

Police to Get Body Cameras

About 150 Israel Police officers will wear body cameras in a 3-4 month pilot project. The objective is to assure fairness for every person, and mitigate violence. Cameras will also be installed in homes where domestic abuse has been reported. The police has allocated NIS 40M for full-scale deployment of the cameras after the pilot project’s completion.

The Economy

Growth Spurt

The Israeli economy grew by 3.7% in the second quarter of 2016 and 2.9% in the first half of the year, according to Central Bureau of Statistics released in mid-August. The figures show that private consumption, the economy’s growth engine for the past two years, was even higher in the first half of the year, rising by 7.3%.

Tech Funding Up

Israeli tech start-ups raised $1.7B in the second quarter of 2016, up 55% from the previous quarter. For the first half of the year, Israeli technology firms raised $2.8B, 35% over the $2.1B raised in the first half of 2015.

Unemployment Low

Israeli unemployment stood at 4.7% in July, a new low, according to the Central Bureau of Statistics. Employment of those 15 and over was 64.4%, representing a small increase. On the downside, the CBS said that a greater number of those employed had jobs that were considered part-time (less than 35 hours a week).

Israel’s unemployment rate for the second quarter of 2016 was 4.8%, down from the previous quarter’s 5.2%. According to Central Bureau of Statistics figures, just over 61% of the population was gainfully employed.

David Reznik, an analyst at Bank Leumi, notes that the positive figures conceal some negative trends, particularly that most of the new jobs were in the health and hospitality sectors, where pay levels are relatively low.

The new $200M Sorek power plant has begun operation, providing 140 MW of electricity. Half of the output of the new plant, located south of Tel Aviv, will go to the nearby water desalination plant, the other half to factories in the area. The plant was built by a consortium including Yitzhak Tshuva’s Delek Group, desalination specialist IDE Technologies, controlled by the Israel Corp., and Hutchinson Whampoa. The plant will be fueled by natural gas from the offshore Tamar field, whose owners include the Delek Group. Value of the gas contract is estimated at $750M.

Cyprus Cooperation

Israeli and Cypriot officials are due to conclude an agreement by September for cooperation regarding development of their respective Yishai and Aphrodite undersea gas fields. The subject was discussed during a July meeting between Cyprus President Nicos Anastiades and Prime Minister Benjamin Netanyahu in Jerusalem.

Meanwhile, the Ministry of Energy, Water and Natural Resources has approved a plan for accelerated development of Israel’s offshore Leviathan field, which will make Leviathan gas available to Israeli users in 2019.

Gas Rights Sold

Energean, a Greek firm, has signed a $148.5M deal to purchase Israel’s Karish and Tanin gas reservoirs from Avner Exploration and Delek Drilling, subsidiaries of the Delek Group. Located in the north of Israel’s exclusive economic zone, the two reservoirs jointly contain about 58.7 billion cubic meters of gas and 14.3 million barrels of condensate in contingent resources, the Greek and Israeli firms said. In addition, the fields may contain about 25.6b. cu.m. of gas and an additional 4.3m. barrels of condensate.

Meanwhile, Avner Exploration and Delek Drilling reported a 28% increase in gas consumption from their offshore Tamar field in the second quarter of 2016 – 2.3 billion cubic meters compared to 1.8 b.cm in the parallel quarter of 2015.

Household Credit Up

About 30% of Israeli households have nearly NIS 100,000 in consumer credit, according to a Bank of Israel survey.

Hotels Recover, But

Occupancy rates in Israeli hotels amounted to 68% in July, according to the Central Bureau of Statistics and the Israel Hotel Association. The figure was slightly lower than the 71% of July 2014, just before the month-long Operation Protective Edge in Gaza. About 1.6 M of the total 2.2 million hotel-nights came from Israelis, with 660,000 from foreign tourists.

Sodastream Move

SodaStream International is expanding hiring at its new location in an industrial park in Israel’s Negev desert. With 1,400 employees in the industrial park, a third of them Beduin, it is one of the largest employers in the Negev. Under pressure from an international boycott threat, SodaStream last year moved its operations from the West Bank to the Negev; the move cost more than 500 of the firm’s Palestinian employees, residents of the West Bank, their jobs.

Guajarat Road Show

The Indian state of Gujarat highlighted investment opportunities and promoted Indian-Israeli cooperation in a one-day road show at Tel Aviv’s Dan Panorama Hotel on August 1.

Borgas Out of ICL

Israel Chemicals has announced the resignation of CEO Stefan Borgas. Borgas, 51, who is from Germany, has headed ICL since 2012. The announcement cited personal reasons for the Burgas move. According to one report, he has differences with Idan Ofer of the Israel Corp., the controlling shareholder. But another report, in Yediot Aharonot newspaper, said that Burgas resigned in the wake of a sexual harassment claim by a female employee.

Aerospace & Defense

Elbit’s New Systems

Elbit Systems, the largest Israeli private defense contractor, unveiled SPECTRO XR, a new electro-optical payload system, at the Farnborough Airshow in mid-July. The system’s core is a multi-spectral imaging system that combines multiple cameras into one, allowing it to significantly improve performance without increasing size and weight. SPECTRO can be installed on a variety of platforms including: rotary and fixed-wing airborne platforms, aerostats, naval vessels and land applications.

The Israeli defense contractor also introduced Skylark C, a highly autonomous Mini Unmanned Aircraft System (Mini-UAS) specifically designed and built for maritime applications. Based on the Skylark I Mini UAS, which is fully operational and in use by dozens of customers around the world, Skylark C transforms and extends the operational capabilities of its land-based counterpart into an organic maritime Intelligence, Surveillance, Target Acquisition and Reconnaissance (ISTAR) asset.

In mid-September, Elbit was awarded a $90M-plus contract to supply its SPECTRO XR advanced electro-optic systems to an unnamed country in the Asia-Pacific region. The contract will be performed over a 4-year period.

According to foreign reports, Elbit has also been given a contract to supply Thailand’s M60A3 tanks with electro-optical systems. According to a separate Thai report, Israel Military Industries will also participate in the tank project, upgrading engines, adding rocket-firing capabilities and active anti-missile defense systems.

Navy’s USV

New-generation unmanned surface vessels are due to be delivered to the Israel Navy in mid-2017, according to a Defense News report. The four vessels, made by Oregon Iron Works and funded by U.S. military aid, incorporate remote-control technology developed by government-owned Rafael Advanced Defense Systems. The twin-engine vessels, called Shomer Hayam (Sea Guard) in Hebrew, will be deployed to defend Israel’s offshore gas fields and in anti-submarine missions.

Amos 6 Accident

The sale of Israel’s SpaceCom Satellite Communications to a Chinese firm has been put on hold after the Israeli communications satellite was destroyed when the SpaceX Falcon 9 rocket due to place it in orbit exploded on a Florida Launchpad during pre-flight procedures on September 1. The $200M Amos 6 was a key factor in Israeli businessman Saul Elovitch’s sale of SpaceCom to Beijing Xinwei Technologies for $285M.

The total loss was due to mechanical failure of the launch rocket operated by Elon Musk‘s SpaceX. Amos 6 was due, among other things, to provide fast Internet services for Facebook in Africa.

SpaceCom, which operates Israel’s Amos communications satellites, had been on the market since 2013. Elovitch is the controlling shareholder in Israel’s Bezeq telecom.

Elbit Gets Uruguay, European Contracts

Elbit Systems has been awarded a $19M contract to provide its Safe District system to Uruguay’s Maldonado District Administration. The system incorporates more than 1,000 cameras and sensors, providing traffic and other information on an area covering about 2,000 square kilometers and six municipal units, to a control center with real-time data.

The private Israeli defense contractor also said it had won a $30M contract to supply advanced thermal imaging observation systems to an unnamed European country. The systems, to be supplied over a year’s time, will serve command levels from dismounted soldier to headquarters command.

Arkia Buys Embraer Planes

Israeli airline Arkia is purchasing six airliners from Brazilian aerospace firm Embraer for $650M. The E195-E2, due to be delivered by 2019, are in addition to four Embraer planes already in Arkia service.

Rafael’s Lithuanian Deal

Rafael Advanced Defense Systems has been awarded a €100M contract to provide the Lithuanian Army with Samson Mk2 advanced remote-controlled weapons stations for launching Rafael-made Spike missiles. The systems will be mounted on 88 Boxer infantry vehicles being supplied to Lithuania by the Dutch-German ARTEC consortium. Rafael, which has sold weapons stations to more than 25 countries around the world, says the Samson Mk2 has a low signature but high accuracy and can be loaded from under the turret, inside the vehicle, minimizing danger to the crew and vehicle in combat situations.

Ex-Ministers Get Key Posts

Barely a month after taking office, Defense Minister Avigdor Lieberman has appointed three former ministers from his Yisraeli Beitenu to top executive posts at Israel’s government-owned defense contractors. Uzi Landau, a former minister of Public Security, will be chairman of Rafael Advanced Defense Systems; Yair Shamir, a former Agriculture minister and son of late prime minister Yitzhak Shamir, is chairman of IAI, and Yitzhak Aharonovich, who also headed the Public Affairs Ministry, at Israel Military Industries.

Herons to Mali

IAI will supply Airbus and the German Defense Ministry with Heron 1 unmanned aerial vehicles to be used by the German Air Force in Mali, West Africa. The agreement is similar to one under which Airbus has operated IAI’s UAVs for the German Air Force in Afghanistan since 2010. IAI will lease several UAV systems starting in November and until the beginning of 2018 for intelligence gathering purposes.

German Defense Minister Ursula von der Leyen announced in mid-September that the UAV deal, valued at $645M, would be delayed for several months after General Atomics of the U.S., an unsuccessful bidder for the contract, filed a court complaint challenging the tender as not competitive.

Japanese Talks

Japanese news sources have reported advanced talks between Israel and Japan of joint development of unmanned aerial vehicles. Japan’s team in the discussions reportedly is headed by Hideaki Wanatabi, head of the Ministry of Defense’s Acquisition, Technology and Logistics Authority.

UAV Deal with Kazahkistan

Israel and Kazakhstan have agreed on the joint production of unmanned aerial vehicles, the Kazakh Defense Ministry announced. The deal was struck in late August, after a meeting between visiting Kazakh Defense Minister Imangali Tasmagambetov and Israeli Defense Minister Avigdor Lieberman. The UAVs will be produced in a plant near Astana, the Kazakh capital, using Israeli technology and training. No value to the deal was announced.

Sea Hawk Sale

The U.S. is selling eight Sikorsky SH-60F Sea Hawk helicopters to Israel as part of its Excess Defense Articles program. The sale also includes spare parts, among them fuel tanks, video displays and machine guns.

German Agreement

Germany’s ThyssenKrupp will invest 320M euros in Israel industry and make purchases worth 350M euros from Israeli firms, in Israeli products in a reciprocal purchase deal. Last year, Israel signed an agreement to purchase four warships from ThyssenKrupp Marine Systems for a reported 430M euros, about a third of which is from a German government grant. The vessels will be deployed to protect Israeli offshore gas fields.

IAI Cyber Contract

IAI has signed a $40M contract to provide advanced cyber detection and analysis systems to an unnamed Asian country. IAI recently opened the fourth of its R&D centers at the new Cyber Center in Beersheba.

Appointment Withdrawn

Reversing a decision by his predecessor Moshe Ya’alon, Defense Minister Avigdor Lieberman has decided not to extend the term of retired Brig.-Gen. Yitzhak Gat as chairman of government-owned defense contractor Rafael Advanced Defense Systems. Instead, he appointed a former minister of his party, a Technion graduate, Uzi Landau, as Rafael’s new chairman.

IAI-Honeywell Cooperate

IAI and Honeywell of the U.S. have agreed to joint development of sense-and-avoid capabilities for IAI’s family of Heron unmanned aerial vehicles. The system, aimed at assuring safer civilian airspace, is due to be demonstrated for the first time on a Heron UAV in 2018.

Wheeled APC Unveiled

Israel’s Ministry of Defense has released photographs of its new highly maneuverable and rapidly deployable wheeled armored personnel carrier, called Eitan. The first Israel Defense Forces carrier to be on wheels rather than tracks, Eitan has eight wheels, can travel on roads between theaters of operations, has a maximum 90 kph speed, can carry up to 12 soldiers and will be equipped with the Trophy active defense system (aka Windbreaker) developed by Rafael Advanced Defense Systems. Eitan is similar to the tracked Namer APC that has been in IDF service for a number of years.

The Eitan, being developed by the MOD Tank Administration and the IDF Ground Forces Command, will replace the outmoded M-113 armored personnel carrier, thousands of which are in IDF service. The decision to develop it was taken after 2014’s Operation Protective Edge in Gaza.

IAI in LCA

Radar from Israel Aerospace Industries, Elta subsidiary is to be included in India’s new Tejas Light Combat Aircraft (LCA), planned to replace the country’s Russian-made MIG-21s. LCA’s manufacturer is Hindustan Aeronautics Ltd.

Joint Missile Defense Trial

Israel and the U.S. tested the connectivity of Israeli and U.S. missile defense systems in a successful early July trial. The test, conducted with the U.S. Missile Defense Agency, was the first in the last eight years. It examined the command and control compatibility of Israel’s Arrow, Iron Dome and David’s Sling systems with the Americans’ Patriot, THAAD and Aegis, as well as U.S. systems stationed in Israel and in Europe, and took place as at development centers of a number of defense contractors, including Elbit Systems and the Elisra Group.

More Female Fighters

The number of women serving as combat soldiers in the Israel Defense Forces has increased more than 400% over the past decade, according to a report in Yediot Aharonot. Yediot said that there were 2,045 women in IDF combat roles last year, compared to only 450 in 2005. Ten years ago, the women fighters were concentrated in one battalion, Caracal; now there are three, with the addition of Lions of Judah and Bardelas.

Making Kalashnikovs

CAA, based in the southern Israeli city of Kiryat Gat, is manufacturing enhanced versions of the famous Soviet-era Kalashnikov AK-47 assault rifle. The weapons, called the Alpha, comes in varying calibers – 7.62 mm, like the original Russian rifle, and a 5.56 mm, like the American-made M-16. CAA says it is also developing a new 9-mm model for use mainly by police and security forces.

According to a report in Globes, CAA is looking to sell its weapons to gun lovers in the U.S., and hopes to export tens of thousands of weapons to North America.

Strong Elbit Report

Elbit Systems reported second quarter revenues of $804M, up from $749M in the parallel quarter of 2015. Net profit rose to $54M, compared to $45M for QII/2015. The company said it had an orders backlog of $6.8B, more than two-thirds of it from overseas.

IAI Staff Reductions

Around 800 of IAI‘s 16,000 employees will either retire early or retire with increased compensation under a plan announced by the government-owned defense contractor and its unions in late August. In addition to cuts in salary costs, the plan includes increased investment in marketing and structural changes. IAI, reporting to the Tel Aviv Stock Exchange, estimated cost of the program at NIS 150-200M.

IAI hopes to fund the agreement by reaching agreement with the Finance Ministry that would allow it to reduce dividends it currently pays to the state. If that does not succeed, the Finance Ministry does not appear ready to assist in financing of the reorganization.

IAI’s financial difficulties appear to stem largely from losses suffered by its Commercial Aviation and Bedek Aircraft groups, whose respective businesses have slumped due to the economic slowdown that began in 2008. Commercial Aircraft had a 2015 operating loss of $30M, while Bedek lost $43M last year.

Southward Bound

The Defense Ministry has announced a tender on the first stage of a planned move of Intelligence Corps HQ to a new large base in the Negev. Bids on planning, the first stage for the base that eventually may house as many as 15,000 personnel is due to close at the end of 2016, for a facility due to be completed before the middle of the next decade.

More Mall Security

A walk-through body screening system that detects potentially dangerous materials hidden under clothing is being installed at a shopping mall in Kfar Saba, northeast of Tel Aviv. The system, called EasyCheck, has been developed by Camero Tech, a specialist in sense-through-the-wall security systems for homeland security and defense. The company says EasyCheck is more efficient and less intrusive than existing systems.

Philippine Deal

Elbit Systems will supply six Soltam M-71 towed howitzers and ammunition to the Philippine Army by March of next year, according to a report on the Israel Defense website. The delivery is part of a June 15 agreement to supply howitzers to the Philippine Army and Philippine Marines. Recently, Elbit has provided upgraded M113A2 armored vehicles to Manila.

Combat Robot Training

The Israel Defense Forces has begun training soldiers to operate the first combat robot it will deploy in significant numbers with infantry units. According to a report in Yediot Aharonot, the MTGR micro-technical ground robots are made by Roboteam, an Israeli firm headquartered in Tel Aviv.

The IDF Engineering Corps for some time has been using a reconnaissance robot to detect and identify tunnels, but the new deployment is the first time robots will be used by less specialized IDF units. Developed by two veterans of IDF Special Forces units, the MGTR’s electric motors can operate for over two hours from lithium batteries. Fitted with a microphone and five cameras that can be used both day and night, IDF sources say it will “accompany soldiers in the field” and help them see “what is waiting around the corner.”

Plasan’s Olympic Medalist

Guarder, a 4×4 armored vehicle made by Israel’s Plasan, was deployed by the Sao Paulo police department to provide security during the recent Rio Olympic Games. Plasan, based in Kibbutz Sasa near Israel’s northern border, is a world leader in the design and development of armored protection systems.

Guarder, which can carry payloads of up to 3.5 tones and 24 personnel, including the driver and commander, is equipped with cameras capable of capturing thermal and optical images.

Joint Exercise

Eight Israeli Air Force F-16I (Sufa) jets returned from the U.S. on August 31 after participating in a U.S. Air Force exercise with jets from other nations, including Pakistan and the UAE. Speaking to Haaretz, the head of IAF training, identified only as Col. Amit, declined to comment, saying only that his pilots “train with anyone who attends the exercise.” In addition to the eight fighter jets, IAF refueling planes took part in the exercise, which ended on August 26.

Chen Named as Head Defense Exports Control

Racheli Chen will take over as head of the Defense Ministry’s Exports Control Agency later this year, replacing Dubi Lavi. Lavi, who has headed the agency for two years, will be the new head of the MoD’s procurement mission in New York. Chen, the first woman to hold the Exports Control Agency’s top post, is a veteran ministry official and the current ECA deputy head.

APCS Get Dragon

IDF technical units have begun installing Elbit Systems-made Dragon advanced firing systems on Israel Defense Forces infantry’s Achzarit armored personnel carriers and Puma armored vehicles used by the Engineering Corps. The Dragon is designed to deal with needs learned in recent conflicts, including the 2014 Operation Protective Edge in Gaza. One key Dragon feature, according to a report in Globes, is the ability to spot potential targets quickly in all weather and light conditions.

VW, Ex-Shin Bet Head in New Cyber Firm

Volkswagen, the German automaker, has joined forces with Yuval Diskin, former head of Israel’s Shin Bet (Internal Security Agency) and other top former officials of the Israeli domestic security service in forming CyMotive Technologies. The company, based in Herzliya north of Tel Aviv, will develop cybersecurity products for self-driving and conventional automobiles and other vehicles. Joining Diskin in the venture are Tsafrir Katz, who headed the Shin Bet Technology Division and Dr. Tamir Bechor, the former top man in Shin Bet Information and Computerization operations.

Archaeology & Defense

Israel has an abundance of archaeological sites, but the latest one may be the most unusual: an archaeological garden set up at Camp Rabin, part of the Kirya complex housing Defense Ministry HQ in central Tel Aviv. The garden, largest of its kind in Israel, is a joint initiative of the Israel Antiquities Authority (IAA), the Ministry of Jerusalem Affairs and Heritage and the Israel Defense Force.

IAA director Yisrael Hasson called the site “a reminder that spans thousands of years of history to the daily life of tens of thousands of soldiers and visitors that are part of a chain of magnificent life.” Hasson, a former deputy director of the Shin Bet internal security service, has served as a Knesset member for the Yisrael Beitenu and Kadima political parties.

Roboteam Raises $50M

Roboteam, an Israeli manufacturer of unmanned ground vehicles (UGVs) has secured an additional $50M in investments, mostly from Singapore, based on a $200M company valuation.

Founded in 2009 by Yossi Wolf and Elad Levy, veterans of elite Israel Defense Forces units, Roboteam has operations in Israel and the U.S. In addition to the IDF, its clients include Thailand, Singapore, the UK, Poland and multiple U.S. law enforcement or military agencies. Several Roboteam bomb-disposal units are already deployed with U.S. Army Special Forces and have been used by police in Boston and Paris.

New Navy Commander

Brig.-Gen. Eli Sharvit took over as commander of the Israel Navy in mid-September, replacing Maj.-Gen Ram Rothberg. Rothberg led the navy for the past five years.

Maor Exits IAI

Rafi Maor left his post as IAI chairman in mid-September. He is being replaced by Yair Shamir, who was named after Maor announced his resignation in late May. Maor resigned after an ongoing dispute with Ori Yogev, head of the Government Corporations Authority over Maor’s performance in preparing government-owned IAI for privatization. Shamir, the son of the late Prime Minister Yitzkak Shamir, a former Knesset member from Defense Minister Avigdor Lieberman’s Yisrael Beitenu party, has served as minister of agriculture and is a veteran IAF pilot.

Poland Shown Anti-Missile System

Raytheon, the U.S. defense contractor, has shown Poland a version of the Israeli David’s Sling missile interceptor system developed by Israel’s Rafael Advanced Defense Systems. Earlier this year, Raytheon, which produces some David’s Sling components in the U.S. as part of the arrangement with the Americans on financing the project, showed reporters in Kielce, Poland, the SkyCeptor missile which is part of the system.

Reporting on the event, Yediot Aharonot pointed out that there are differences between the David Sling system already adopted by Israel’s Ministry of Defense and the version shown by Raytheon. For one thing, the paper said, the Israeli version uses radar from Elta, IAI subsidiary, while the American version uses a Raytheon-developed control system. David’s Sling, sometimes known as Magic Wand, is the third component in Israel’s missile-defense system, together with the Arrow for long-range rockets and Iron Dome, designed to intercept and destroy projectiles with a shorter range.

According to the newspaper report, Poland’s interest in missile defense is part of a general program for upgrading its military, which was adopted after the Russian takeover of Crimea.

Search Technology

Special IDF Home Front Command rescue units called on still-experimental detection technology in an effort to locate construction workers trapped when an unfinished parking garage in an industrial area in north Tel Aviv collapsed in early September. Six workers died in the accident. Among other things, the IDF unit, consisting of regular army soldiers and reservists, used special sensors to locate the cellphone of at least one of the victims and a UAV hovering overhead to mark the location for teams digging in the rubble.

Finance & Investment

Private Equity Deals Dip

Private equity purchases in Israel totaled $2.9B for the first half of 2016, down from the total $3.7B in the first half of the previous year. At the same time, average deal value rose to $53M, up from 2015’s $39M per deal. Market sources attributed the dip to caution on the part of the funds about future world economic trends.

Tech Fundraising Soars

Israeli high-tech firms raised $1.7B in 187 deals during the second quarter of 2016, according to a July report from the IVC-KMPG research firm. The total was up 55% from $1.1B raised in the previous quarter. At the same time, a report in Yediot Aharonot said that high-tech exits had declined by 22%.

Intel Picks Trio

Intel Capital, the investment arm of the U.S.-based semiconductor giant, has invested a total of $25M in three Israeli-American start-up companies, spanning cloud computing, machine learning and network infrastructure. The three, in which Intel had various partners, are Velostrata is headquartered in San Mateo, California, with an R&D base in Israel; network infrastructure specialist Sedona Systems of Cupertino, California, and Israel; and Panoply.io, a Tel Aviv and San Francisco-based cloud-computing start-up. Intel Capital says it has invested over $345M in more than 80 Israeli companies since 1997.

Abramovich Keeps On Buying

Russian billionaire Roman Abramovich, best known as the owner of London’s Chelsea football club, has added two more high-tech companies to his growing Israeli portfolio. The new companies, price of which was not announced, are Spot IM, a social engagement platform, and DreaMed Diabetes, which provides diabetes treatment and management solutions. Abramovich, through his various investment companies, was the lead investor in recent financing rounds for Music Messenger, a music-sharing app, the iAngels investment network, and AnyClip Media, which specializes in video marketing. The Russian billionaire’s other holdings include Via, a transit company; nanotech battery charger developer StoreDot; electronic capsule developer MelCap; and AcousticEye, which has pipe inspection technology, and has also invested in Altair, a venture capital fund focusing on early-stage Israeli start-ups.

Two Firms Raise $35M

Behalf, an Israeli firm with offices in Tel Aviv and New York which has an innovative way of providing credit to small businesses, has raised $27M in a financing round which included Viola Growth, Sequoia, Mission OG, Spark Capital and Vintage. The firm, founded 5 years ago by brothers Benji and Shai Feinberg, pays small business suppliers by providing recipients with lines of credit, amounting to $3,000-$50,000.

Meanwhile InSights, with offices in Tel Aviv, Berlin and Washington D.C., has raised $12M from a group of investors including Bloomberg Capital, Blackstone and Glilit. The company, which has developed analytical tools that aid managers in making decisions, was founded by Dr. Gal Alon, formerly a strategic development adviser in the Israeli Prime Minister’s Office.

Dairy Financing

Bank Leumi, one of Israel’s two largest banks, will provide $37M to finance establishments of a dairy farm and dairy in Papua New Guinea. The loan is jointly guaranteed by the Papua New Guinea government and the Israel Foreign Trade Risks Insurance Corp. The farm will be set up and managed by the LR Group, an Israeli contractor.

Buy-Back Completed

Taro, the Israeli subsidiary of the Sun Pharmaceutical multinational, has completed the buy-back of $250M worth of its own shares. The company, which manufactures and markets the highest quality healthcare products offers prescription and over-the-counter pharmaceuticals in the dermatological and topical, cardiovascular, neuropsychiatric and anti-inflammatory categories, took five months to purchase the shares.

Mergers & Acquisitions

Playtika Sold for $4.4B

A Chinese consortium has acquired Israeli social games company Playtika from Caesars Interactive Entertainment for $4.4B in cash. The seller is Caesars Interactive Entertainment of the U.S., which bought Herzliya-based Playtika for about $170M in 2011. The Chinese consortium includes game developer Shanghai Giant Network Technology, Alibaba Group founder Jack Ma and his private equity firm Yunfeng Capital, China Oceanwide Holdings Group, China Minsheng Trust, CDH China HF Holdings and Hony Capital Fund. According to some reports, South Korea’s Netmarble had offered $4.3B for the Israel-based company.

Under terms of the sale agreement, Playtika will continue to operate from Herzliya, with its Israeli management.

Playstudios-Scene53

Playstudios of Burlingame, California, a developer of free-to-play casino games that offer real-world rewards, has acquired Tel Aviv-based Scene53. Purchase price was not announced. The Israeli firm, which specializes in real-time, multi-player mobile games, jointly developed Playstudios’ newest mobile app, called POP!Slots. Playstudios plans to operate Scene53 as an independent studio.

Amdocs Triple Buy

Amdocs, the Israeli business systems leader of Ra’anana-Kfar Saba (northeast of Tel Aviv) and St. Louis, announced the purchase of three firms in a single mid-September day – Pontis, a Tel Aviv-based provider of contextual digital engagement solutions, U.S. software-as-a-service management solutions developer Vindicia, and Brite:Bill, an Irish firm that makes payment solutions. Price of each of the three acquisitions was in the $95-90M range.

Teva Completes Allergan Buy

Teva Pharmaceutical Industries, based in Petah Tikva and Jerusalem, in early August completed the $40B acquisition of Allergan‘s generic business and followed it up the next day with a $500M purchase of Anda, Allergan’s distributor of generic pharmaceuticals in the U.S. The Israeli generic giant and Allergan had agreed to the purchase deal involving $33B in cash and the remainder in shares in the summer of 2015.

Ford-SAIPS

Ford, the American automaker, has purchased SAIPS, a computer-vision and machine-learning specialist based in Rehovot, southeast of Tel Aviv. Ford said the purchase was part of its major investment in developing autonomous, driverless vehicles. Purchase price was not announced.

Adama Stake Sold

Discount Investment has sold its 40% stake in Adama, the producer of crop protection chemicals, to ChemChina for a reported $1.4B. According to a Reuters report, the deal paves the way for a merger between Adama and agrochemical producer Sanonda, a subsidiary of ChemChina, which already owns 60 percent of Adama.

Freightos-Webcargo

Jerusalem-based Freightos, a big-data start-up, has purchased WebCargoNet of Barcelona, the world’s largest air cargo rate management provider. The acquisition creates the world’s largest database of air, ocean and land freight rates with hundreds of millions of international and domestic rates and routes. No finance details were disclosed about the acquisition but media reports suggest it was for several million dollars. Freightos, which also has offices in Hong Kong, has raised $23.3M to date.

BC Partners-Keter Plastic

BC Partners, a pan-European private equity investment fund with offices in London, Paris, Hamburg and New York, has contracted to purchase 80% of Israel’s Keter Plastic from the Sagol family. Purchase price was not announced, but is estimated based on a company value of about $1.3B. The founding Sagol family will continue to own 20% of Keter, whose sales in 2015 were about €800M. Half of Keter’s revenue comes from new products launched in the past three years.

iCarbonX-Imagu Vision

iCarbonX, a Chinese big data company, has acquired Tel Aviv-based Imagu Vision for an undisclosed sum. Imagu Vision, which will change its name to iCarbonX Israel and serve as the Chinese company’s development center in Israel, focuses on artificial intelligence.

Specializing in medical information, iCarbonX does not confine itself to processing data; it also collects the information itself from hospitals and medical clinics, Internet chats between consumers, medical devices, while cooperating with medical groups all over the world. iCarbonX Israel will be responsible for analyzing all information collected by the parent company.

Riverbed-Aeternity

Riverbed Technology, a San Francisco-based specialist in application performance products, has purchased Israeli company Aeternity. Purchase price was estimated in the $60-$70M range. Aeternity, which develops user-experience monitoring tools, was founded in Israel in 2004; it currently has company headquarters in Westborough, Massachusetts, and maintains its development center in Hod Hasharon, northeast of Tel Aviv.

eBay-Sales Predict

eBay, the Internet marketing giant, has purchased Sales Predict, a Netanya-based specialist in analysis of customer behavior. Sale price was not disclosed, but media sources estimate it at about $40M. eBay says the acquisition will help it understand, and organize, price listings in its huge catalog of items.

Frutarom-Redbrook

Frutarom, the Israeli specialty flavors company, has agreed to acquire Redbrook Ingredients of Ireland. Purchase price of the savory flavors company, Frutarom’s sixth acquisition this year, is about $45M.

Playtech-Best Gaming

Playtech, the London-based online gaming platform controlled by Israeli Teddy Sagi, has acquired a 90% share of Austria’s Best Gaming Technology for €138M in cash. The Austrian firm is a leading provider of sports betting technology.

MassiveImpact, a platform specializing in social media promotion of mobile application has been sold to General Mobile Corp. (GMOBI), of Taiwan. Purchase price was not announced, but is estimated in the tens of millions of dollars. Tel Aviv-based MassiveImpact, a 2014 Red Herring Top Global award winner, reaches over 1 billion users in 190 countries. Its clients include Gameloft, Citibank, AIA, Tencent, and Baidu.

Somoto-Meme Video

Somoto, an Israeli software firm based in Tel Aviv and Houston, Texas, has acquired Meme Video for $3.5M. Meme Video’s business includes acquiring digital video media and adapting them to an advertiser’s target market. Somoto specializes in Internet marketing, video and mobile advertising, and distribution services for software and apps.

Leviev-AFI

Lev Leviev has acquired 65% of AFI Development, its development arm in Russia, from Africa-Israel Investments. Leviev, the billionaire diamond businessman and principal shareholder in Africa-Israel, has always considered AFI his pet project.

Two Deals

FIMI, the Israeli private equity fund headed by Yishai Davidi, is acquiring Galam from Kibbutz Ma’anit and the Bereshit fund for a reported NIS 300M. Galam, founded in the 1940s, manufactures fructose-based candy and starch for both the food and other industries.

A few days after the Galam acquisition, FIMI sold H.R. Givon, a Haifa-developer of precision components for the aviation industry, to Wipro Infrastructure Engineering of India for NIS 300M. FIMI purchased Givon for NIS 70M in 2008.

IDB Sells Adama Stake

China National Chemical Corp. (ChemChina) is assuming full control of Israeli agrochemical firm Adama after purchasing Israel’s financially troubled Discount Investment Corp. 40% stake in the joint venture for the equivalent of $1.4B, including erasure of a $1.17B ChemChina loan to IDB when it bought a 60% stake in Adama in 2011. Adama is the world’s largest maker of generic agrochemicals.

Fujan Yango-Phoenix

Israel’s Delek Group, controlled by businessman Yitzhak Tshuva, has signed an agreement to sell its 52.3% controlling interest in Phoenix, the Israeli insurance group, to a subsidiary of China’s Fujan Yango group for about NIS 1.95B. Efforts to sell Phoenix have been under way for some time as part of Delek’s effort to divest itself of its financial holdings in order to concentrate on its energy business.

Uber-Otto

Uber has acquired Otto, a San Francisco-based developer of self-driving technology for trucks, for a reported $680M. Otto was founded in January of this year by Lior Ron, an Israeli, formerly of Google Maps, and Anthony Levandowiski, a former member of Google’s self-driving car team. Prior to joining Google, Ron graduated from Haifa’s Technion-Israel Institute of Technology.

Otto does not make trucks. It produces hardware kits that can be installed relatively quickly on trucks at service centers or factories, a strategy that fits in to plans by Uber, the ride-sharing company, to focus on self-driving technology without manufacturing vehicles.

SeaSpine-NLT

SeaSpine Holdings, based in Southern California, has agreed to acquire Israel’s NLT Spine in a deal with a maximum value of $43M, including target payments. NLT Spine, of Kfar Saba, Israel and Dedham, Massachusetts, develops minimally invasive implants and orthopedic treatment devices for degenerative spinal conditions that are inserted through a relatively small incision and expand inside the body of the patient.

Toluna-Crossense

Toluna, a French marketing technology, has acquired Caesarea-based digital tracking start-up Crossense for an undisclosed sum. The 10 employees of Crosssense, which has developed a digital tracking system for cross-platform behavior, will join Toluna’s R&D center in Haifa.

Marlin-Qualitest

Marlin Equity Partners, a Los Angeles-based private equity firm, is acquiring QualiTest, an Israeli specialist in quality testing and business assurance services. According to the Israel Today freely distributed newspaper, purchase price is NIS 300M. Marlin, which also has offices in London, is a global investment firm with over $3B under management.

Formula Eyes Allot

Formula Systems of Or Yehuda, which controls Israeli software companies Sapients International, Magic Software and Matrix IT, reportedly is interested in purchasing Allot Communications of Hod Hasharon, according to a report in Globes. Several other companies have expressed interest in Allot, which deals in bandwidth management solutions, including Israel’s Radware.

Science & High Technology

Women’s Conference

Representatives from 30 countries are due in Tel Aviv in late September as finalists in the women-only Start Tel Aviv competition, part of the DLD Tel Aviv Innovation Festival. Goal of the competition, sponsored by the Tel Aviv Municipality and the Foreign Ministry, is to “encourage female entrepreneurship and find the world’s preeminent female-led start-ups.”

South African Power Deal

Rioglass Solar of Beit Shemesh, about halfway between Jerusalem and Tel Aviv, has signed a NIS 70M (about $20M) deal to provide solar receivers for a new 100 MW power plant in South Africa. The plant, which uses the thermo-solar method for generating electricity, is Rioglass’s third South African contract in the past two years, with a total value of NIS 235M (about $60M).

Smart City Trial

Israeli telecom Bezeq has launched a “smart city” pilot program in Modi’in, a city of about 100,000 midway between Tel Aviv and Jerusalem, to eventually develop Internet technology control of municipal activities including street lights and trash collection, parking and air pollution. Hundreds of sensors have been deployed in Modi’in, mainly in a large park, along with cameras and free Internet to help city officials monitor parking, noise, safety and the quality and amount of water in a man-made lake.

Smart Cities Cooperation

Israel’s mPrest, developer of the software on which the Iron Dome missile defense system is based, is cooperating with China’s Hisense on technology for “smart cities” in China. According to a report in Yediot Aharonot, the deal is the Chinese giant’s first Israeli connection.

High-Speed Robot

Ben-Gurion University researchers say they have developed a revolutionary robot that converts wave motion from a single rotary motor into vertical motion. The robot, inspired by the way snakes move, is said to be five times faster than other robots. It was developed by BGU’s ABC Robotics initiative.

Boost from FDA

A U.S. Food and Drug Administration decision requiring that implants of stem cells secreting insulin must be placed in a device equivalent to an artificial pancreas has boosted interest in Beta-02 Technologies, based in Rosh Ha’ayin in the high-tech belt northeast of Tel Aviv. According to a report in Globes, Beta-02 is currently exploring possible cooperation with a number of possible partners, including several Big Pharma firms. Beta-02 officials say that their device can be replenished with an injection of stem cells once a week, considerably less than the daily insulin injections required by many diabetes patients.

Wix and the Yankees

Wix, the Tel Aviv-based do-it-yourself website design specialist, has entered into a partnership with the world’s most famous professional baseball team, the New York Yankees. In addition to becoming the Yankees official website design partner, Wix will be involved in a search for the team’s number one fan. The winner will build a site together with Wix at the TheBiggestYankeeFan.com domain. Wix already has a similar deal with England’s Manchester United football club.

Driving Force

Jerusalem-based Mobileye, a developer of automated road-safety technology, says that a self-driving system it is developing with Delphi Automotive will be ready for production by 2019. Mobileye cut its ties with Tesla Motors in July, after the electric carmaker’s autopilot system was involved in a fatal accident.

Meanwhile, another Israeli player has entered the self-driving system race. Innoviz, a start-up developing advanced sensors and systems, said in early August that it had raised $9M from a group of investors including serial entrepreneur Zohar Zisapel, Vertex Venture Capital, Magma Venture Partners, Amiti Ventures and Delek Investments. At the heart of Innoviz’s technology is a high-definition solid state laser-based, or LiDAR, sensor that offers what the company says is a wider field of view and higher resolution than similar sensors while significantly cutting costs to less than $100.

Energy Saver

Home BioGas, an Israeli start-up, claims that the system it has developed can turn a family’s ordinary organic waste into enough energy to cook three meals with some ultra-rich organic fertilizer as a by-product. Small number of the systems, which look like the kind of devices used for years to turn food scraps into organic fertilizer, are already in use in villages in the Palestinian Authority, among Beduins in Israel’s Negev desert, and in Latin America. According to the company’s founders, the system is designed for use in isolated areas with no regular power supply, and in ecologically-conscious communities in developed Western countries.

Amdocs Working with AT&T

Amdocs, based in Ra’anana and St. Louis, Missouri, will be the integrator for telecommunications companies and cloud developers using AT&T’s ECOMP platform to build their own software-centric network services and integrate ECOMP open-source software into their own networks. ECOMP is designed to prepare for increased network loads from virtual reality and augmented reality, 4K video and the Internet of Things.

Israel Inside

Intel says its new 7th-generation core processors, developed at the multinational’s Israeli development centers, improves performance dramatically, by 12% in application and 19% in Internet use, compared to the previous generation of Intel chips. And that’s not all, says Ran Senderovitz, GM of Intel‘s Israel Development Centers: “Moreover, if you have computer at home that is four or five years old and then bought a PC with a seventh generation processor you’d see an improvement in speed of up to 70% in routine tasks.